tv Key Capitol Hill Hearings CSPAN November 1, 2013 8:00am-10:01am EDT
>> so just earlier this week i was out at dyke marsh. it's near alexandria right along the mount vernon trail, and it's a beautiful natural area that has been eroding dramatically since dredging activities happened some decades ago. i was announcing that we would be rebuilding a lot of that wetland by putting in some containment things to bring back the natural marshes, but most importantly, there were two school groups out there, young kids representing all the colors of the rainbow and all the enthusiasm that only young children can have, telling me about the ph and the water quality. and out there with their instructors. these are the best classrooms. and when you've got kids in particular that are bouncing off the walls -- i could ask for a
show of hands about how many of you have them, because i'm sure it's a lot -- how about putting them in a classroom that has no walls? that's what we can do. third, we're setting a goal of engaging one million volunteers in support of public lands by with 2016, effectively tripling the numbers that we have right now. i've served on many trail crews, and i know that volunteering, for me, establishes a connection to place like nothing else. a couple weeks ago i was in rock creek park with the rock creek conservancy undercover removing invasive english ivy from the trees in the park. i'll never look at rock creek park same way. i now understand how invasives are playing a role there. this does, in fact, change lives. and by ramping up a modern version, a 2.0 version of the civilian conservation corps, interior, u.s. department of agriculture, other agencies of
the federal family are going to work with americorps, student conservation association and other veterans groups from around the country to give many more young people these kinds of opportunities that will, in fact, change their lives. so when i was in the grand detons, i had -- tetons, i had the privilege of engaging with a group of people graduating from the national park service academy which is something that the superintendent of that park invented. and these young people from urban areas around the country were talking about their stories. and there was one young man from jackson, mississippi, who was a pretty cool guy, i'll tell ya. and he talked about, first, being so cold when he went will in the springtime because it wasn't like jackson and being there through the summer and riding his bike along the moose wilson road and stopping and looking at the vast tetops and starting to cry. and he said i didn't know why i was crying.
but this experience in the outdoors moved him, it changed his life, and it can do so with many, many others. so finally, to generate the next generation of stewards of our public lands and to insure our own skilled and diverse work force, interior and other federal land management agencies will provide 100,000 work and training opportunities to young people over the course of the next four years. that's hard. no doubt, it's ambitious, especially in tight budget times. and in order to make it happen, we're going to have to prioritize our budgets, build off successful programs and work in partnership with schools with nonprofit organizations and communities to leverage existing resources, and we're also going to work with corporate and nonprofit organizations to raise an additional $20 million over four years to support these youth work and training opportunities. i know as a business person businesses want to be part of the solution. i know there are many organizations and individuals that want to see our lands protected and the next generation engaged. and i will pledge to them that
we will make sure our taxpayer dollars and our philanthropic contributions work together to make that happen. so in closing, we're continuing to move ahead in fulfilling our mission at the department. as stewards of our public lands, wildlife and waters, as managers of our great national parks, in partnership with tribal nations w states and stakeholders we will meet the needs of the present generation without sacrificing the rich legacy that we pass on to future generations. this is our commitment to all americans, and this is my perm commitment to you -- personal commitment to you. it's no different than the promise made by teddy roosevelt over a century ago and, teddy, you can check my words -- [laughter] as he described what he called a great moral issue. he said: i recognize the right and duty of this generation to develop and use the natural resources of our land, but i do not recognize the right to to waste them or to rob by wasteful use the generations that come
after us. of all the questions which can come before this nation short of the actual preservation of its existence in a great war, there is none which compares in importance with the great central task of leaving this land even a better land for our descendants than it is for us. and training them into a better race to inhabit the land and pass it on. conservation is a great moral issue. for it involves the patriotic duty of insuring the airty and continue answer -- safety and continue answer of the nation. so as we look to the next 100 years of this nation, the next century of the national park service or the next five decades of the wilderness act, these words from roosevelt should serve as a call to action and inspiration to all of us. thank you. [applause]
>> thank you, madam secretary. i, we covered a lot of topics there, including bear poop which i don't think we've talked about over the microphone here before, but thank you for that. we have a range of topics to ask questions on, but let me start with one of the most pressing ones recently because of the shutdown. jonathan jarvis took a lot of heat over the closures of the washington monuments like world war ii. was there any political motivation behind the barriers that were erected around the national parks? >> in two words, absolutely. no yout. you know, i've learned a lot of things over the last six months, one is the anti-deficiency act of 1870 and the criminal penalties that it causes if you put people on staff to do anything other than protecting life and property. so the people of the national park service can did not want to barricade the monuments, but the monuments don't take care of themselves. so we had park police to
protect, but normally there'd be about 300 people on staff that are walking the mall, taking care of visitors, picking up garbage, cleaning the restrooms, maintaining the grounds, interpreting what was there, and they were not allowed to come to work. so the barricades were there to protect the resources, and we worked as best as we could. and i know the honor flights from the world war ii thanked us for making every accommodation we could within the letter of the law to help the veterans see the monuments that they wanted to see, but do it in a way that also pull filled our obligation under the anti-deficiency act and the decision to close the parks. so absolutely no political motivation. [applause] >> so as long as we're talking about the shutdown, do you have any more of a refined estimate of what the government closure cost local economies near the country's major national parks? and following up on that, the questions come from several members of congress that the interior department repaid the states for running the shutdown
in '95-'96. why can't you do that now? >> that's what i call a multiple probe, two questions at once. [laughter] so the first question, we mow that national parks generate about $76 million a day in economic activity. every day is not equal. every park's not, you know, generating as much activity at the same time, so we're still tallying the numbers to try and understand that. i do know that for concessionaries people were furloughed, and they did not get paid. people were let go, food spoiled. there's a lot associated with that that can't just be made up with what they would normally make in economic activity. still working on those numbers, we don't know them. what was the second one? >> sorry. repaying the states. >> okay. so it's misinformation. the states in 1995 were not repaid for money they gave. in fact, what happened -- and it was only one state, it was the state of arizona -- they agreed to pay, they sent a deposit in. the shutdown ended, and the
deposit was sent back. so there actually wasn't any money kept by the federal government in 1995, and we had to do some digging back in historical records to understand that. but our records are going to be much more helpful should this crazy thing ever happen again. hopefully memories are longer than they were last time, and we won't have to go through it. but there was never any federal money repaid to the states the last go around or this go around. >> little bit of breaking news today. senate republicans today blocked two obama nominees, mel watt for the housing agency and patricia ann -- [inaudible] for u.s. court of appeals. as somewhat of a newby to washington, what does this say about how washington works or doesn't work, and how does this impact you with so many unfilled positions at the interior department? >> i've never seen anything like it in my life. [laughter] it's very different than the private sector. [laughter] very, very different. it takes a little bit longer, has all kinds of complications.
but i'm confident that we will round out a strong team led by mike connor. could you just give a wave, even though it's not your style? mike is nominee to be deputy secretary of the department of interior. fantastic, knowledgeable resource. brings a great depth of background. he's through the senate committee. they have agreed to forward his nomination to the full senate, and in that list that's waited to get voted on by the full senate which we hope will be very soon. or nominated by the president to be the assistant secretary for fish, wildlife and parks, currently serving as assistant secretary for policy management and budget. these are two terrific individuals we hope will be through the process very quickly. certainly, there are other people that are serving in an acting capacity in the department of the interior, and i am treating them as though they're going to be there forever. we are not waiting for this long and laborious process to keep things moving because we've got important work to do. and the team that's there whether they're acting or they are permanently in the
positions -- well, as permanent as these positions are -- they are all working together to make sure we drive the agendas and the priorities forward without having to wait for the nominations. but, again, we hope that they happen fast. >> presidents usually take the opportunity to name some big national monuments, i think all presidents have done so. they don't need to go to congress by using the antiquities act, the president could do that. or what are some of the areas that may be under consideration for national monuments, and will the president use the antiquities act to name some? >> well, the president has used the antiquities act nine times so far in his administration, and certainly, if congress doesn't step up to act to protect some of these important places that have been identified by communities and people throughout the country, then the president will take action. i think it's consistently true that every action that he has taken has resulted from a support that's come from the community where the community
has said this is special, we want you to protect it. so that will continue to happen. there are places all over the country, as i mentioned in my remarks, i'll be going out to visit some of them, i'll be meeting with community members, understanding why these places are special before we go forward with any actions, but there's no question that if congress doesn't act, we will act. we'll also say that there are dozens of bills in the house and/or the nat right now -- senate right now that very identified as special -- have been identified as special areas they want to set aside. so it would be great if they took action just like happened in the omnibus public lands act of 1989. we hope those mechanisms will be used to recognize these special places and to take care of them. >> just to follow up on that, would the president act to use the antiquities act in any case where the local community objected? >> i said throughout my confirmation hearing that we would be working with the local communities.
now, does that mean everything has to have 100% support? i guess i haven't seen anything yet where everybody agrees on everything, but certainly where there's a groundswell of support, we will be focusing our energies. won't be focusing our energies where there's a tremendous amount of conflict. >> you talked about climate change for a little bit. there are critics on all sides, of course, some are saying interior's punishing oil and gas industries in favor of renewables and others are saying you haven't done enough to push renew ables. how do you see the fit? >> energy is important. it drives our economy. we're sitting under lights here, we've got cameras rolling, and those are all driven by electrons that have to be produced somewhere. the president made it clear that he had an all of the above energy strategy, and that's something that i embrace and i understand. i'm also really proud of what the department of interior has done to stand up renewable energy programs around the country. we've announced several offshore wind lease sales, innovative way of doing master lease planning
to work out conflicts and to put areas that have high wind potential and low conflict like i was talking about with landscape level understanding and conservation. worked on solar plants like the desert renewable energy conservation plan. these are important utility-scale plans that provide renewable energy to supplement the nonrenewable energy resources we have. but both are being done across the landscape. interior works with companies that have involved in both conventional and unconventional renewables and nonrenewables, and that's what we expect to continue to do. you can't just switch off a major part of our energy source and expect the economy to thrive. you have to do it in a thoughtful way over a long period of time, and i think that we're striking that right balance. >> for years certain members of congress have been arguing the interior department should not purchase more land to extend parks, wildlife refuges and other lands until the maintenance backlog and existing
holdings is eliminated. i believe senator coburn had a report this week on that subject. what are your thoughts about the idea of the interior not taking care of what it has already and, therefore, shouldn't purchase more? and with that, what would be put at risk if your department would not be able to acquire new properties? >> so this is a common refrain that people toss around. frequently i'll say the same people that squeeze our budgets so we end up with a larger may maintenance backlog. you can solve a maintenance backlog -- yes. [applause] you solve a maintenance backlog by taking care of it. it's not that complicated, and as a business person -- [laughter] you know, that's what we did. on a regular basis. that's what kept the economy going. so this is really, i just have to editorialize, it's very, very hard to run something on a month to month or year to year basis when you're talking about assets that last for a long time. so, well, in perpetuity, how
about that for a long time? [laughter] so the circumstance that you described, tommy, is -- i'd say it's a common fallacy. so i was out in the tetons, as i mentioned. there is a large tract of land in the middle of the teton valley owned by the state that if we aren't able to buy from the state, will get developed. and it is really critical habitat. one parcel right in the prong horn elk migration, another one right in the beautiful valley below the tetons which has no development at all, and it would all be mega mansions. these aren't areas that are going to cost the park service any more to maintain, but these are critical land holdings that the state wants to sell, the community wants us to find a way to buy, and the park service wants to buy. so that's an illustration. there is money in the land and water conservation fund that goes to supporting easements. you've got a willing property owner that would like to support
hunting access or fishing access or access for rock climbing across their property. they want to sell a conservation easement to do that, and they might as well. so to make the simplistic correlation that putting money into our lands necessarily causes more in maintenance is just incorrect. but i will say i do hope that congress steps up and provides us a more rational budget to take care of these special places that many of them have, in fact, set aside. i will also say that many of the members that are very critical out in the public when i'm meeting with them in their offices want a national park in their district. [laughter] [applause] >> let me get or very specific here for a second. 13% of all oil drilling and fracturing is done on blm lands right now. will that number rise or go down in the future? >> i'm going to talk about
frackinging for a second. because i fracked wells before. probably not a lot of you out there -- how many others have fracked a well in this room? [laughter] okay. i can say anything i want. [laughter] fracking has been an important tool in the tool box for oil and gas for over 50 years, and some of the new techniques that are being used actually reduce the amount of footprint on a surface acreage in order to address and recover oil and gas from a much larger area. so this is an important tool, but it has to be done safely and responsibly. and the blm is working on regulations. some of you are aware of, they're going to do just that. we have a number of opportunities to continue to develop oil and gas on blm lands, and we will continue to see that happen. so if you take an example i used earlier of the national petroleum reserve in alaska, you want to minimize the surface
impact for a whole variety of reasons; species migration, sensitive ecosystem, perma frost, all of those kinds of things. by using directional drilling and fracking, they have an opportunity to have a softer footprint on the land, but that's a lot of acreage that the blm has. short answer is we'll likely do more because we'll be leasing more land to do it, but we're going to do it in a safe and responsible way. >> be the national academy of sciences released a review almost 150 days ago on the blm's controversial wild horse program saying, quote: continuation of business as usual practices will be expensive and unproductive for blm and the public it serves, end quote. does the interior department and blm intend to embrace the reforms in the report, and if so, when? or would they not? >> well, the question about how we effectively manage the wild horse and burro program is one that people feel very passionate
about on both sides of issue. it's difficult. there isn't a secretary of interior that i've talked to -- and i've talked to them going back to the 1970s -- that hasn't been aware of this issue and struggled with this issue. so i want to start by saying it's not easy. it's actually quite difficult. the national academy of sciences gave us the report. it was very helpful in a couple of ways. one is it validated what our land managers know which is horses are really good at reproducing. 0% a year -- 20% a year. that that means the herd doubles in size every three and a half years. that's a lot of horses, and providing they are forage, that gives them an opportunity to continue to grow very dramatically and not in a sustainable way which the national academy of science has also pointed out. birth control is an alternative that the national academy of sciences report suggested, and we're certainly supportive of that. challenges in the veterinary world of pharmaceuticals, you
don't have the same controls or the same products as you do in the human world of pharmaceuticals. and we would love to have a stronger partnership with the pharmaceutical i have to come up with a more effective birth control method because it's very expensive, and it doesn't work for a long period of time, and, oh, by the way, you have to get the horses there to give them the birth control. [laughter] i know there's some things you could do with stallions too, but i won't get into that. [laughter] so this is a big issue. it's an issue that's been around for decades. it's an issue that we care about, that we want to manage on a sustainable way. we're not going to be able to fix it overnight. national academy of sciences gave us some good data. we have budget constraints, we have all kinds of alternatives that we're considering, and so we're working on it. we're going to continue to work on it, and i would love this to be a call to action to the pharmaceutical industry to help us develop an effective birth control method that we can use
on horses that would, i think, help this problem get solved. thanks. >> the colorado river is the lifeline to much of the southwest including my home state of utah. it is a finite resource and being capped more and more. as the population of the southwest continues to increase and warming temperatures decrease the mountain snow pack, what can interior do to insure the river doesn't get tapped out? >> i like these little questions that you've got for me. [laughter] >> i try. >> so i'm going the watch mike carr and see how much he squirms, because mike is very knowledgeable on topic. one of the -- it's an interesting job. besides secretary of the interior, i have these other titles, and one of them is the water master for the lower colorado river. sounds pretty lofty. [laughter] mike and his colleagues in the bureau of reclamation introduced me to a really smart group of people from the states who are along the colorado river and
really it's states that manage the water rights. and bureau of reclamation has a pretty big job to do like hoover dam, other dams downstream in managing the stream flows and working with the states and, frankly, keeping this coalition together. they've also at reck that mission been working on something called water smart which is just like being sensible about how we use energy and electricity, being really sensible at how we use water. we don't want to waste water. we want our canals in some cases if they can be covered, there's less evaporation. if we can prevent leaks, there's things that we can do to make sure every drop of water gets to its intended source. but there's also increasing demand. so working with states to identify better methods of using water more sustainably that also support ecosystem needs is exactly what this group of very smart people from all the states along the colorado river have been working on in conjunction with my colleagues at the bureau
of reclamation and others. it's a big job, and it's all of our job to use water more wisely than we have in the past. because there's an awful lot that can be done just in how we use it, whether for agriculture or municipal uses or other uses. and this is something that this team of people working behind the scenes is working carefully to do because with, you're right, climate change is upon us. you see it in droughts throughout the west, we see it in the colorado river. if you look at the levels in lake powell or lake mead or any of the other lakes that are in that region, you will see that we have a huge problem. and, by the way, we share this river with mexico which is where mike was just a few days ago. so these are important and not easy issues, but they are issues that are being addressed by some very, very smart people at both the state and federal level and local. >> we're almost out of time, but before asking the last question, we have a couple of housekeeping matters to take care of.
i'd like to remind you of our upcoming events. november 5th, goldie hawn, the actress will be here at be national press club. november 7th, former senator judd gregging, ceo securities industry will be here, gregg plans to unveil protections for investors. november 11th, president and ceo of the charles schwab corporation will be here. secondly, i i would like to present our guest with the traditional npc mug. [applause] i'm sorry it didn't come from rei, but -- [laughter] finally, for our last question, i think we wanted to ask the most pressing issue for those of us who live here in washington, when will the washington monument reopen? be. [laughter] >> we hope to have it open a year from now. there are people who kind of
like its exo skeleton. i have a wonderful job, but it's made more wonderful by some of the places i can go. there's been a few places where i said could i do this? and they say, ma'am, you can go any place you want. [laughter] so one of those was i got to climb up the stairs to the scaffolding and then the ladder that went to the top of the monument and went down. so i kind of liked that exoskeleton for a while. does anybody at the table have the exact date? this kate, do you remember when we're going to reopen? no. okay. i'm pretty sure it's going to be a year from now. thanks. >> we will invite you back to give us the exact date. how about a round of applause for our speaker today. [applause]
>> thank you all for coming today. i'd also like to thank the national press club staff for organize toking today's event. finally, here's a reminder that you can find more information about the national press club on our web site. please check it out at www.press.org. thank you, we are adjourned. [inaudible conversations]
>> later today a look at the role of the international atomic energy agency with iaea's chief speaking at an event hosted by the wilson center. live coverage at 11:30 a.m. eastern on c-span. >> john foster dulles had recently died when that super airport out in chantilly, virginia, was being built, and president eisenhower immediately announced that the airport would be named dulles airport. for a while when kennedy took over, he didn't want to name it after a crusty old cold warrior, but there was pushback from others, and finally the decision was made to name it after dulles. you can still see the film clip of kennedy opening the airport with eisenhower there and alan dulles there, and he pulls back a curtain, and behind the curtain is this giant bust of john foster dulles. and that bust stands in the middle of this big airport.
so i went to see it while i was writing this book, and i couldn't find it. i started asking the security guards, where's the big bust of dulles? nobody had ever even heard of it. it was a long process and finally, thanks to the washington airport authority, i was able to discover that the bust had been taken away from its place in the middle of the airport, and it's now in a closed conference room opposite baggage claim number three. and i find this a wonderful metaphor for how the dulles brothers -- who at one time exercised earth-shattering power and were able to make and break governments -- have now been effectively forgotten and air brushed out of our history. >> john foster heading state and alan at cia, the dulles brothers led both overt and covert operations for a good portion of the to cold war. find out why the ramifications can still be felt some 60 years later with steven kinzer, sunday
night at 8 on c-span's "q&a." >> this painting was originally painted as my grandmother's official white house portrait. in the 1960s lady bird johnson went looking for portraits of first ladies to hang, to rehang in the white house. she thought that was important. and she looked high and low, and she could not find my grandmother's official portrait. so she called my grandmother, and she said, mrs. truman, do you know where that painting is? we can't find that. and my grandmother said, yeah, it's on my wall. and mrs. johnson said you really shouldn't have that, it belongs in the white house. and my grandmother said, no, that's my painting, it's on my wall, and that's where it's going to stay. and i think mrs. johnson tried a couple more times, be i eventually -- but eventually she gave up. >> watch our program on bess truman at our web site, c-span.org/firstladies or see it saturday on c-span at 7 p.m.
eastern, and we continue our series live monday as we look at first lady mamie eisenhower. >> and we are live this morning with business and investment conference hosted by the commerce department. secretary of state john kerry will headline the event. president obama was there yesterday announcing a new government-wide effort to encourage foreign companies to open new factories and create jobs in the u.s. today's lineup includes remarks by penny pritzker, the discussion on free trade deals with the owes of bm -- ceos of bmw north america and caterpillar. this is live coverage on c-span2. [inaudible conversations]
>> again, we are live this morning with coverage of a a conference, a commerce department business and investment conference with remarks from secretary of state john kerry. we'll hear first from commerce secretary penny pritzker, there will also be a discussion on free trade deals with the ceos of bmw north america and caterpillar. by the way, we'll have highlights of this conference from over the last two days including the president's comments yesterday, and that'll happen sunday starting at 2:30 eastern. you can also view those highlights online at c-span.org. while we wait for this to begin, we'll show you remarks from this conference yesterday. national economic council chief gene sperling. >> that more needs to be done,
and i'll put it in two categories. one or more additional policies that we need cooperation from our congress to implement to help make us more competitive and more attractive to you and, second, is how we organize ourselves and the messages we send which we have a little more control over. on the policies some of the things the president is pushing right now which do, for all our divisions, have more bipartisan support than you would think is comprehensive immigration reform which would increase the need for skilled labor that many people say is critical to their location decisions. so this is a very, very top priority of the president as is making sure our training programs are more demand driven, that we're working with you and community colleges so if you want to locate here, that there's someone who says if you're a little unsure whether there's a particular skill need that may not be met in a
particular location, that we will work with you to make sure there is a training program, a partnership that works for you. that's one area. the second area which the president's put out is to have what he calls kind of a grand bargain on jobs where you would lower the corporate tax rate, have a lower corporate tax rate and at the same time use some of the one-time funds to strengthen our infrastructure so that your supply chains can move more quickly. so these are important components we have to do and, obviously, the third one is that we have to give -- and we fight very hard on -- a greater sense of stability. i guess you could say we want more manufacturing and less manufactured crisis. and, you know, we haven't been at our best the last month, but i think the future looks brighter in painting a picture of stability. now, the thing that is under our control is the signals we send and how we organize ourselves. and i think, to be honest, we had to recognize that there were places where signal that the
president wanted to send was not coming through. one or two high profile cases might be sending a signal that we were not open for business. you know, we want to make clear this is not a xenophobic nation. if you want to come here and make your fortune playing by the rules, investing in the united states, creating jobs, we don't just tolerate it, we welcome you with open arms. and a lot of the motivation for this select usa conference was to, in a very old way, make that abundantly clear. secondly, how do we organize ourselves? the united states has generally organized itself to, you know, in our embassies, etc., in ways that focus on commercial advocacy and export promotion. but our efforts at recruiting in the united states, and this goes back, you know, administration after administration for decades has been more ad hoc. now, that's not good for us because we do not have an organized, coordinated way of
encouraging people who want to invest here to invest here, butst not good for those who want to do it either because it can seem ad hoc. it's not clear who's going to be there, who's going to help. so when the president comes today, what he's going to talk about and what we're putting out is a major reform effort to, for the first time ever, have the united states make a core economic priority the encouragement of foreign companies to have job-creating foreign direct investment here in the united states. and this is not just an empty phrase. there is -- we have, are engaged in a very serious effort of having unprecedented coordination between congress department led by penny pritzker, the state department by john kerry working together with valerie, myself and others in the white house economic team. and what this will mean is that in the 32 to start, in the 32 nations that make up over 90 president of the fdi right now,
for the first time ever there will be an organized team led by ambassadors who will work together with one team in their state department and commerce department officials, and they will have as one of their core missions now for the first time encouraging and facilitating foreign direct investment in the u.s. and then they will have one channel they will go to to the kind of headquarters of select usa so that when you are making a decision here, you will have one-stop shopping. you will have one place you can go to to look at visa issues, regulatory issues, state and local, federal issues. and when it's helpful to talk to someone in the white house or valley jarrett or even perhaps the president or vice president themselves, we'll have a process for doing that. so that is the mayor policy announcement that we are announcing today, and i think 20, 30 years from now you will still see this organization in place, and people will wonder why the united states had not
started earlier making a core part of its international and domestic organization type of broader select usa reform. >> and you can see all our coverage from the past two days on our web site, c-span.org. and this commerce department conference on business and investment continues live this morning. secretary of state john kerry will headline the morning. introducing him will be commerce secretary penny pritzker. a little wit later, a -- a little bit later, a discussion on free trade deals with the ceos of bmw north america and caterpillar. secretary kerry will be meeting with saudi arabia's king abdullah next week discussing stability in the region, iran and a number of other issues. in addition to riyadh, jerusalem and bethlehem, secretary of state kerry will stop in jordan, the united arab emirates, algeria and morocco. during the nine-day trip from november 3rd to november 1 isth, poland is also on the
[inaudible conversations] >> ladies and gentlemen, please welcome penny pritzker. [applause] >> good morning. i hope everyone had a great first day. [applause] >> i want to start with a big thank you to the select usa team, and all of the folks of made this summit happen. let's give them a big round of applause. [applause] it was great to hear from president obama yesterday. he said when you bet on america, that that pays off. and i could not agree more. he also announced that the select usa program will be stepping up its game in a number
of ways. attracting business investment will be a major priority for our teams at commerce and state departments, including our foreign commercial service officers, and our ambassadors. senior government officials, including the president himself, will do more to directly advocate for inbound investment deals. we will create a single point of contact to provide you with the coordinated federal support, and cut red tape. and we will do more to support the great work of the economic development organizations at the regional, state and city level. to provide a sports analogy, the commerce department is going to serve as the quarterback for increasing business investment in the united states. in addition, i should note the
president once again called for congress to provide full funding for select usa in his budget. select usa already provides a great bang for the buck, but the responses as this summit shows, that we can and will be doing much more to help you succeed. we want to capture the energy on the exhibit floor yesterday, turning your conversation into united states investment. on another note i want to be clear. we are listening to the leaders of this community more than ever before. i am pleased to announce our commitment to listen to you. let me give you a little bit of background. since 2004, the commerce department has received valuable advice on how to support american manufacturers from domestic companies on our manufacturing council.
but in this global economy, the fabric of american manufacturing has expanded. it now includes subsidiaries of firms based abroad, including many represented in this room. the fact is foreign on us-based manufacturers now support 1.7 million jobs in the united states. and the share of our foreign direct investment dollars are manufacturers has grown to 45%. in many cases these manufacturers have become the economic anger of local communities across the united states. however, these businesses have not had a seat at the table to help us strengthen american manufacturing, and till now. i am pleased to announce that we are revising the eligibility criteria to allow u.s.
subsidiaries of foreign owned companies to serve on our manufacturing council. we want to hear -- [applause] >> thank you. we want to hear all the good ideas for strengthening american manufacturing and creating even more jobs. and i want to thank the organization for international investment and its members for bringing this issue to the forefront. now let's turn to the agenda for a number to. after this morning's keynote speaker, who i would introduce in just a moment, you will have a high powered channel with investor michael froman, tennessee governor bill haslam, and the ceos of caterpillar and gm north america. -- bmw north america. using u.s. operations as a platform to take advantage of our free trade agreement. in fact more than 20% of the united states exports come from subsidiaries based abroad.
the next 10 will demystify the united states market. it features a mix of top leaders from business, academia and associations. we will then have two sets of breakout sessions with topics ranging from workforce development to securing working capital and financing for your investments here. we will wrap up the afternoon with a panel on the united states energy environment come into discussion on exhibition oe exhibition floor on how to take the edge of service providers. for right now let's get to this morning's keynote speaker. i am honored to introduce secretary of state john kerry. he is a proud son of a decorated former foreign service officer. as a young man, he served two tours of duty in the amount, receiving a bronze star -- in
vietnam, a bronze star, a silver star and three purple hearts. he served as a top prosecutor of the county level in massachusetts and then went on to be elected lieutenant governor, and two years later he was elected to the united states senate where he served 28 years. the last four of those years he served as the chairman of the senate foreign relations committee, developing relations around the world with world leaders. in fact, -- every foreign policy issue for the united states over the past three decades. this year he became the first sitting chairman of that committee in over a century to become secretary of state. and just two weeks ago i was honored to travel to asia with senator kerry where we pushed forward key administration initiatives like the trans-pacific partnership.
our nation is very lucky to have someone with secretary carries knowledge, and global reach in this leadership position. ladies and gentlemen, let's give a warm welcome to a national hero, a man who has dedicated his life to serve the united states and a tireless can do later who is tackling the tough global issues facing our world. lease help me welcome my friend, secretary of state, john kerry. [applause] >> good morning. thank you. thank you very, very much. thanks so much. thank you, penny, for an extraordinary introduction, and
based on that introduction i accept the nomination. [laughter] only kidding. i'm out of that now. i'm out of that now. i'll tell you, about a couple months, before i was offered the job of being secretary of state i was still oddly serving in the united states senate, and i was walking through an airport monday and this fellow -- you know some people have that sense of recognition, and he pointed me to a, you. hey, you, anybody tell you, you look like that john kerry guy we sit down to washington? and i say, they tell me that all the time. he says kind of makes you mad, don't it? [laughter] so i'm very happy to be out of the electoral process, folks. just fine by me. i'm really happy to be here, and i'm very, very honored to be
introduced i penny who is a good friend. she's very involved with me in 2004 when i ran for president. i'm just so thrilled she is now our commerce secretary, and i'm very grateful for the effort and energy that's gone into making this first ever summit such a success. no one who knows penny is going to be surprised by that because everything that penny is done in business, philanthropy, in public service has always been a success. those of you who know her, know that she's really a dynamic ceo in her own right, and you can feel the energy and leadership that she's already bring to the commerce department. she's a fabulous partner, and i'm thrilled by it. very, very happy to have her there. i was with her, i heard her in the introduction talk about her being -- we had a chance to go out and break bread together, and we're chatting and she was reminding me of the story of her
dad who started a family business with one motel out in los angeles, she kind of lived in motels and she went to san francisco and boom, it grew to six and now everybody knows what the hyatt hotels, corporation, it's a great american story, a great story of entrepreneurship. we are so proud of penny and grateful that she's stepping back from the private sector to share with us that expertise and give us the energy and dynamics we need. her leadership select usa is one of the reasons that this effort has the potential to grow our country, and to grow all of yours. for those of you who are here visiting so many other countries. we welcome you here. the single biggest reason select usa is going to make a difference is frankly all of you, a group of very capable business leaders, people who are
hungry, who understand the dynamics of the marketplace, who are ambitious and your business goals who come here with a vision from nearly 60 countries around the world and from all across the united states. i said in my confirmation hearing when i was selected to become secretary of state, i said to the senators, my former colleagues, that in many ways foreign policy today is economic policy. and leaders and government need to understand that. there is a synergy and an importance to this relationship that cannot be denied. i think many of you are here because you understand this new marketplace that we are all operating in, huge appetite, and very, very fast moving. and we wanted you to come here.
select usa is the umbrella that is hosting this event because we believe deeply, we are convinced based on our dealings in the room, exposure in the world without arrogance, without chauvinism, that there is no better place in the world to invest in here in america. and there's no better time to do in many ways and right now because some of the growth and development of the last few years is so equalized out in some places so that manufacturing as the secretary said, the number of manufacturing jobs here, we are growing in manufacturing out again because it's competitive again for a lot of different reasons. so make no mistake as we look ahead to major trends that will define this new age, the factors that will determine which countries thrive as well as which businesses thrive in this competitive marketplace, i think it's crystal clear that the united states is going to continue because it's the nature
and pace of our economy. not because we are somehow superior and somehow better. just the nature of how we have grown, where we've come from, from the industrial revolution all the way through the 1990s and the tech explosion and two where we are now. we will continue to lead the world. in both innovation and education because of the nature of our universities, the structure, the number, and the openness with which they operate. and i believe also people will have access here because we will continue to work hard to make sure that we have the most qualified workers and one of the largest consumer markets in the world. again, i say, i don't say any of this with one touch of arrogance. i say it because that's -- that goodness for america's also in fact good news for the world.
and it's good news for you and your businesses. and you know the importance of the american economy in terms of driving china's economy and other economies in the world, and their imports now to driving other economies in their regions and elsewhere. and it's a principle reason why i believe you ought to invest here. is why president obama is making attracting job creating investment a top priority at a level unlike any before. so you are sitting here this morning, we believe, in the heart of the most open economy in the world hear the united states already is the world's largest recipient of direct foreign investment, in addition to investment penny mentioned about manufacturing, we have about 5.6 million total good paying american jobs and contribute close to a trillion dollars to our economy that comes from the foreign direct investment. that's why manufacturing,
pharmaceuticals, i.t., energy companies, form many other countries are now setting this up, setting up shop here in the united states every day. our trade agreements are built on the premise of shared prosperity. we have deals that go both ways, and those create good paying jobs all over the world. they offer american firms unprecedented global access which we think is critical, but it also opens our doors and our markets to foreign firms. i want you -- and i think incidentally, i'll just tell you, i think this is the direction of the world. this is the way the world is going to move. and those who understand and those who will move most rapidly to embrace a higher standards and the openness are those will be able to take advantage of the new marketplace and be leaders in the global economy.
nobody can put this genie back in the bottle. i used to argue it's up in the senate with my colleagues. we have a great nafta debate and all those other struggles, free trade versus coming to, sort of old order if you will. and the fact is that every single time we would move forward in that openness in of think time we embrace with those agreements we've done better. we transition. not always without some destruction but not always without some dislocation, obviously, but with a massive infusion of new energy and new creativity and new innovation, new jobs that come with the change. i want you to measure what we've done with our neighbors. canada and mexico. we opened of north america through nafta, the greatest single step towards shared prosperity in this hemisphere. and we know we don't have to share a border in order to share a business which is why we have free trade agreements with 20
countries and shelley to morocco to south korea, markets that together reached 700 million people and 7 trillion in gdp. but none of that alone would actually make the united states the best place to invest if we didn't also focus on our workers and make sure that we're doing as much as we can to try to the best workers, and most skilled and the most productive that we can in the world hopefully. and that's true in part because we work hard to make sure that we train in the best schools and universities. a lot of effort that goes into that. and we reach out to bring the brightest minds in the best talent from all over the world. many of you know that if you were may be educated here in the united states. i can't tell you how many heads of state, finance ministers, foreign ministers, prime ministers throughout government,
heads of state and chief executives who i meet because i traveled the world, and have for the last 29 years as a senator, he came to the united states to go to school, or who participated in educational exchanges in the fulbright program for instance, or in other programs. meet him everywhere. foreign minister of saudi arabia who has been foreign minister for 30 plus years or more, you know, proudly reminds me of his education at princeton, for instance. and the foreign minister today showed and i saw him in new york at the united nations general assembly anthony a photograph and said, this was you and me 25, 30 years ago when i met you at fletcher school of law and diplomacy when you were a senator. incredible. that's the new world we are living in. maybe a lot of you have a cousin of a friend who came to our shores to start their own business. in fact, about half of our small businesses are started by immigrants who know instinctively that the american
dream is not restricted to those born in america. you go to miami, chicago, san francisco or any major city in america, you will find a community that speaks your language, understand your culture, welcomes diversity and can serve as an anchor for your next venture. and it's not just the big cities. you've heard from president obama, secretary pritzker, secretary lew and many others at the summit about a lot of the success stories, indian manufacturers expanding plant in upstate new york, singapore companies extend their supply chain to the heart of texas. german multinationals creating jobs in small town kentucky. canadian pharmaceutical subsidiaries investing in suburban ohio, and south african energy firms investing in southwest louisiana. that's not in the future.
that's now. that's the present. so there's no question that the united states is lucky to be able to offer the world's best investment climate today. and i say lucky. we are blessed to have it, and we do try to work at it. president obama has made it clear, we are going to work at it even harder. no investment is about the past. it's about the future. so we're going to refuse to sit still. the world as we all know is getting more competitive, but so are we. capital chases confidence. and i'm confident that we're going to continue to get stronger and be more effective. select usa is a big reason why. you have heard yesterday, and perhaps during the week, those of you here, we are working hard now to make it even easier for you to be able to invest here. and making that effort has a
much bigger part of our mission, especially now at the state department. at home we are coordinating at every level from mayors of small towns all the way up to president obama picked the state department family around the world has been instructed, working with the foreign service of the commerce department, that we must organize dedicated investment teams led by are capable ambassadors, drawing on the talent of our dedicated embassy staff, and we are going to actively encourage job creating investment in the united states as a core priority. our diplomats already played a huge role in helping your businesses succeed in the united states. in estonia, our ambassador led an intensive outreach effort to encourage tech startups to come to the united states. in canada, embassy officers worked with a local automotive firm in order to invest tens of millions of dollars in michigan
where the american auto industry is now making a remarkable comeback. all over the world, working hard to help businesses meet their goals, the state department is engaged with a new level of intensity and focus because of the nature of the global marketplace. we believe we can do more and we are going to do more. starting in 30 markets that represent more than 90% of all the foreign investment the country. so what does that mean for business leaders like you? it means that you will now have a single point of contact to connect your company with our market and investors and the economic front organizations who are here to help you and your businesses grow. just the other week i met with a group of ceos in indonesia, and some of them expressed frustration to me with some of
the foreign governments who preach the principle of open markets but then actually practice protectionism. these ceos know, as you do, that freer markets create more opportunity, more growth, more dynamism, and more innovation. the freedom to fail is an important component of succeeding. so in order to open more doors and in order to continue the best investment climate in the world, we are going to continue to add to our strong portfolio trade agreements that reaffirm our commitment to open and free markets. and to a level playing field. now, globalization means that people everywhere now have higher expectations. in many ways the revolutionary events that have taken place in the middle east and some other
parts of the world are a reflection of that. tunisian revolution that peacefully removed a dictator of some 30 years was not ideological, was not inspired by religious extremism. it was a fruit vendor who wanted to practice his trade without corruption and without interference. and that fruit vendor sparked that revolution because people wanted to touch the expirations that they now know the rest of the world is living in some in place the the same thing in tahrir square. the tahrir square was not the most brother. tahrir square have nothing to do with that kind of politics or with any kind of religion or any kind of ideology but it was young people texting each other, using the smart phones and the virtues of being able to text
and tweet and connect with people that brought about another revolution. and the same thing is what started sure you. although syria was corrupted without the other interests and other forces. no leader in new in the world can afford to look away from huge populations of young people coming at us in unprecedented numbers. all of them in touch with their aspirations picked a different world is going to change politics as well as -- so what we're going to try to accomplish with two enormous and very high standard trading coach haitians that are underway right now is to raise the standards and raised the possibilities for people, the trans-pacific partnership which will integrate the region represents 40% of global trade, and if we can lock that in it will raise the standards around the world.
when you link that to the transatlantic trade and investment partnership which will bring europe which is another 40% of the world's market, you will have, in fact, it's the largest market in the world, that will join with the largest individual economy in the world, and that will create an enormous transformation and the standards that people are practicing by. those efforts will dramatically expand our market reach, and they will strengthen the rules-based trading so that we engage in a race to the top, not a race to the bottom. and that helps everyone can be while insuring strong protections for workers, for consumers and for the environment. while we're talking about markets, we are staring at the biggest market in the world. some people are trying to grab it, but i want you to measure this. the market that created the great wealth of the united states in which every single
quintile of income earner saw their incomes go up in the 1990s, and created unprecedented wealth, more wealth than was ever created any age have no income tax and the funds of morgan's and rockefellers and so forth, much more wealth created in the 1990s. that was a 1 trillion-dollar market. with 1 million users. the global energy market is a $6 trillion market an. and today it has 4 billion users and it will climb to somewhere around six or more, maybe 9 million users over the next 40-50 years because that's where the population of the planet is going. this is the most incredible market ever, and it is the solution incidentally to climate change. so we will fight to stay at the forefront of this energy market. recognizing that it has the benefit of climate change as well as the marketplace. we're going to develop clean
technologies that will power the world, and protect our environment at the same time. we are on pace right now to be the largest oil producer by 2020. largest oil producer in the world. who would have thunk that one a few years ago? that gives us the promise of alternative fuels including shell gas, and we will become fully energy self-sufficient by the year 2035. there's another kind of injury that also i think drives is here in this country. it's the energy that fuels our private sector, and that is the energy that comes out of and an american value called entrepreneurship. the united states does know how to encourage and cultivate startups, because not too long ago our country was a startup. innovation isn't just in her interest. it's in our dna. and that's why we aggressively
protect intellectual property rights as part of a strong, transparent, accountable legal system. today, we need entrepreneurship more than ever. as more and more young people join the labor market, the world is going to need about a half a billion new jobs by 2030. and many of those jobs i guarantee you have not even been invented yet. entrepreneurship will help to solve the puzzle, and select usa can help. a few weeks ago i met with hundreds of entrepreneurs while i was away. was away. these were into their second from all around the world and they couldn't wait to build the next big thing. and who knows? you know, the best ideas are never limited by borders, but these folks may be the ones already changing the world. it that kind of openness that drives the american economy and foreign economies and it moves all of us forward. at the same time.
now, needless to say we have our own interest here for shorter. it's no secret that our presidents number one priority is creating strong middle-class jobs. here at home. but he also knows that the best way to do that is to strengthen our international economic size and foster broad growth around the world. we know that promoting inclusive growth and strengthening the rule of law in other countries also helps us to create new markets for our businesses and jobs for our workers. and when we help other nations to develop their own ability to govern and to meet the aspirations of the booming youth population i talk about, we foster stable societies, and everybody here knows stability is pretty important with respect to investment decisions and prognosis. we do what we do because we've
always known that we are sort of all in this together to we are all connected. and that's another reason why the united states, we believe, is the best place to invest. because there's no other country where you can be so confident that your investment is going to contribute to the share, a shared prosperity. now, that idea is really one of the cornerstones of our country. you saw in the marshall plan. marshall plan rebuild the continent after a war when all economies were shattered, broken. we stepped up, invested and loaned so that we could all share in postwar prosperity. you see it today in the recipients of american citizens are graduating from the assistance into full-fledged partnerships in the trading community. look at south korea.
in less than a generation, south korea has been transformed from an aide recipient to one of the major donors in the world today. that's an incredible story. in fact, that transformation describes the 11th of our 15 largest trading partners. and that kind of shared prosperity today is more important than ever before, the reasons i talked about earlier about young people and their aspirations. we also know in the united states that we are part of something much bigger than just buying and selling, hiring and investing. before anyone is a ceo or a secretary of state, and we are citizens. and by virtue of the fact that you are here, i know that you consider yourselves citizens of the world. so remember, our shared responsibility to ensure shared prosperity is one of the most important ways that we advance
shared security. as secretary of state by obviously travel a lot, and i do it for a reason. because there is no substitute for face-to-face diplomacy. there's no more reliable way to build trust to ensure your interest and values are aligned to close a deal. and that's why you come here from all over the world to be in washington this week to meet each other face-to-face, to build relationships and share the ideas that could, hopefully, conceivably change the world. as you build that confidence in each other i want you to know there is no market in the world that i believe deserves your confidence more than this one. as investors, as friends, i think you understand, the united states, despite momentary political hiccups and despite sometimes the conflict of politics, still marches forward
with the private sector that is increasingly empowered to be able to define for itself what the economic future will be. my message to you is that now is the best time to make that investment. my page to you is pretty direct. get in on the ground floor of this century of possibilities and transformation, the possibility of a great global century, a century hopefully that will be defined almost exclusively by the shared austerity that lifts people all over the world and result so many other conflicts and problems that we face today. because individuals are yearning for the opportunity to touch what we have are actually able to do so. you can be part of that transformation. in fact, it won't happen without you, and i hope the sooner we get around to the business of doing it, the sooner we will solve some of these challenges we face today. thank you for letting me be with you. god bless. thank you.
[applause] >> ladies and gentlemen, once again please welcome to the stage the united states undersecretary of commerce for international trade, francisco sanchez. [applause] >> good morning, everyone. secretary kerry, thank you very much for the excellent, excellent speech. and thank you for joining us on this second day of are somewhat. we had a great day yesterday with president obama, with speakers and panelists, and all the networking and matchmaking opportunities that went on. and today, promises to be even
better. so let's get started. i am very pleased to announce the start of our first panel entitled "why select the usa: using the u.s. as an export platform." we have a great lineup, including my friend and u.s. trade representative michael froman, governor bill haslam of tennessee, ludwig willisch, the ceo of bmw north america, and doug ober heimann, the ceo of caterpillar but i will at the moderator go into more detail on our panelists. so let me introduce who will moderate today's panel. nailer one is a "washington post" columnist and the economic editor of a widely read blog in the post. at the wonk.blog, you can get
analysis. is an author who has covered the federal reserve and let the post coverage of the financial crisis. ladies and gentlemen, please give a warm welcome to our moderator. [applause] >> thanks so much for the quick introduction. we heard from the secretary. we've been through an era in which trade deals with these small piece nothing for individual companies, countries. now we are in a moment where big overarching trade agreement are being negotiated across both oceans with europe and transpacific partnership with a great panel to discuss those things. the governor of tennessee, bill haslam commission mistake that succeed on the world stage as an exporter. it's could have bill haslam with us. [applause]
>> another -- another of america's great export success stories is caterpillar, the giant exporter of mining and construction equipment. doug oberhelman is the ceo. he is with us here today. [applause] >> capital is a great story that exports to the world but we also have a leader of a great european company that makes a great deal of stuff in the united states and we are proud to have ludwig willisch, the ceo of bmw north america is here with us. [applause] and and and his negotiated trade on both sides of the atlantic to the united states, because trade rep is ambassador michael froman. [applause] >> we're going to start with a few comments from each panelist. governor, we'll start with you.
>> thank you. it's an honor to be a. i've been governor of tennessee for three years and one of the things people ask is what did you learn? the answer is a whole lot. but one of the quick things you learn is this. international trade agreements directly impact the job of the state governor. and that's when i started running, like i said so years ago, that certainly would have been one of the key issues on my horizon but it is definitely too. let me give you a little context here in tennessee, we are proud of the fact we still make things. we make a lot of automobiles. we make a lot of furniture which people thought had gone from being produced in the u.s. we have a company just last week announced their moving jobs from china back to tennessee to produce things. a lot of medical supplies. we are proud of fact we still make things. but as you'll see from some of my comments the ability to make and sell those things as directly impacted by many of our foreign agreements.
we sell our exports to europe about $5.3 billion a year, about 2 billion, to china. penny the china foreign direct investment in the u.s. but in tennessee with about 880 different companies located in tennessee. largely led by the a lot of japanese companies. nissan came to tennessee 30 plus years ago and a lot of automotive industries and suppliers have sprung up around them. there are 127 million americans working in manufacturing jobs with foreign ownership. in tennessee, even though we're about 2% of the population, i think we make up about six or 7% of the total number of folks in the manufacturing business with foreign ownership. we are proud of the fact that for the last four years when we've been named the leading state for automotive manufacturing strength. we are proud of the fact that we have the largest cargo hub in
the u.s., and the second largest in the world due to a small little company called fedex which happens to locate in memphis. so we enjoyed the advantage of. and we have for international export development offices in the uk, and germany, in mexico and in china. tennessee exports are estimated to grow if the ttip tariff, treaty happens that's being talked about. we think our exports to europe will grow about 35%. so close to $2 billion would be at stake if that agreement will be passed. we rank second in the nation for manufacturing jobs created over the last year. first in the southeast and both per capita income growth, and gdp for the last 12 months in the southeast and the top 10 in the country. interestingly, we rank second, or the second leading state in the country for medical equip supply exports.
about 11% of the nation's export of medical equipment happens after tennessee and even the again like i said we are 2% of the population. as in most business numbers like that there's a reason. fedex dominates in that business. in medical equipment if you need it, you need a write-in. having fedex as a hub in memphis has made a huge difference force. as i wrap up let me give an example of three large companies that export out of tennessee and why it's important and why the treaties that were talking about our particularly important. eastman chemical is located in upper east tennessee, has a 7000 employees. it's the global headquarters. the export about one and a half billion dollars a year. it's the ttip he is past, it says that that would increase chemical sales about -- exports about $801 a year to europe. we think eastman would get their share of that. nissan is the headquarters for nissan in the americas and their
plant in tennessee is the largest in the western hemisphere. about 14% of the vehicles that they produce are exported. finally, smith is one of those medical equip sparse we talked about in memphis, and the valley other exports is about a billion, and there's other, medtronic and other large suppliers there. on a lighter note we export a few other things from tennessee. with export is brown liquid that people seem to know no matter where i go by the name of jack daniels to i say hi, i'm the governor of tennessee but no matter what country you're in, jack daniels, dolly parton. [laughter] we also are proud of, we have some other nice things exporter were fairly well known for music and not just country. on a sweetener, we make 300 million m&ms every day. unit leverages announced the building the world's largest ice cream plant in tennessee. so no matter what is from chemicals the oddest to sugar, we had to cover. me talk of return over, to the states would talk about in terms
of treaties and free trade agreement and the impact. soon after coming into office, audi was looking a locating a plant somewhere. about a $1.3 billion investment to get into the locating that in mexico. now, there's a whole lot of reasons for governors when a plant located in a state is because the incredible sales job that the governor did. and consumer us with lots of reasons why it went somewhere else. we think of is one reason was that tariffs to import, to export from the u.s., 10% back to europe, 30% to brazil. we are relatively confident one of the reasons that $1.3 billion investment went to mexico was because of the tariff agreements. we think full and limitation of ttip would include -- increase by about 900 million, and the panelists from bmw can talk, i
think we'll talk about the ad ad cost of that and why that's true. let me just a few numbers to wrap up with. countries that we have free trade agreement with, our per capita exports are 16 times, 16 times with the countries where free trade agreement as those that we don't. after nafta, our exports to mexico went up eight times. a candidate three times. after the agreement was struck with chili, our exports to chile went up 10 times. talk about medical equipment better exports are medical equipment to honestly went up about eight times after the free trade agreements were sent. so i'll come back to the point i made to begin with it as the governor were not involved in negotiating trees. we don't debate him in the senate or the house, but those treaties have incredible impact on the things that we do. look forward to discussing it more spin we have an hour. i'm hoping to hear you both capital and bm on locating in tennessee sometime in the next
hour. >> you got it. that's why we're here. >> thank you, new. governor, thank you for a great review. we have a very strong presence in nashua the financial services business, several hundred employees. it's a big business and a folder really like to tennessee for lots of reasons. >> can you say that one more time? >> ditto. i'm often asked about manufacturing in america, and can we compete from the u.s. on and even a level playing field based on what else and what do we build anything here? in fact we built a lot here and it's very timely that they came from athens, georgia, last evening because yesterday we cut the ribbon on a brand-new greenfield factory, 850,000 square feet, 1400 people strong when it's fully operational at the end of next year, and these will be small bulldozers and small excavators that were formerly only produced in japan.
we brought those to the united states for several reasons. one, we can compete from a base. two, we would like -- we like support system here, and a lot of that production will stay in the us and a lot of that will be exported to south america and europe. so we feel there's a very good chance and a very good condition and not only built here by compete from a u.s. base. a year ago we did the same thing in victoria beckham, south texas. these would be for large machines, 40 to 50 time machine. also came in from japan and we will be building those for the first time in the united states and exporting to south america. so someone that is coming back to the u.s. and a very happy and proud of that as a u.s. manufacturing company. in fact, we spent about $6.5 billion in capital expense in the last five years in the united states. we invested heavily here. we've also spent about $10 billion in research and
develop an over that same five year period. we have plant after plant in our system here in the united states that exports very large mining equipment. solely from the united states. we have factors out in the midwest where 80% of the production is for export only. we work hard at being competitive both internally in our system at caterpillar but we also work hard with the u.s. government and michael and many others to open markets outside the u.s. because after all, 95% of our potential customers are not in this country. they are outside and we desperately need that. over the last five years our total exports have exceeded $82 billion from the united states. and those are destined for virtually every country in the world at some point or another. i cannot over emphasize the benefits of trade and open trade, but sometimes it's a hard message. free trade, open trade and
globalization sometimes has a pretty tough context in a lot of small towns were our plans are. that's a message that all of us have to get out and work on, because without access to those 95% consumers outside this country, i don't know where we will be in a generation or two from the. we all need to work on that. finally, as kind of an editorial comment and then i'll conclude, we use ex-im bank and needed to compete on a global basis. export credit agencies are part of the competitive landscape. other countries use them aggressively, and every time we go up against them, it has most of her competition if not all is outside the u.s. they are competing with us for jobs, for our customers, for our people for that matter. xm has been a needs to be a critical element of that play as we go forward. so that soviets also on the agenda along with open and free
trade as we go forward. without i'll conclude. thank you. >> thank you very much for having me. bmw certainly embraces the concept of u.s. as a viable export platform. cooperative and open free trade initiative in this country have provided the basis for bmw to make a major investment into production facility which not exports the majority of its vehicles worldwide. bmw group as a success story to share in our south carolina plant. however, it's more that could be done to foster even more economic opportunity in the u.s. when all parties come to the table to ensure more open bilateral trade agreements are embraced. back in 89 when our company is looking to locate a new bmw infection plan in the united states, we received invitations from many state governors to
they all had an rsvp attached. obviously, we understand the actual french phrase, and we did respond to all. however, our rsvp also has another meaning for the bmw group. this meaning help us to determine the actual site we chose. first, rsvp as an acronym for the values that have to be met for this new manufacturing facility to be successful. rsn responsible. s. as in sustainable. v as invaluable and p of course as improbable. after evaluating many american sites, supplying -- applying our rsvp values we chose self drilling and open the plant in 1994. today, it is an unqualified success in terms of production and worldwide export. i'll give you some metrics in a
moment but here is how rsvp works for the bmw group. talking about responsible. we received some offers that while financial attractive to us, might not have been equally beneficial for the local business and vibrant and infrastructure, and so we refused it. we felt and still feel that the responsible approach of locating a new facility has to be a win-win for the state, county, city or town, and the local population. responsibility also means being able to provide jobs for skilled local area rather than to not rely on the invitation of an outside workforce. a strong network of technical schools and motivated workforce, southeast u.s. and other states in south carolina fulfills these requirements. also the i-85 transportation corridor provided us with an
infrastructure, future export opportunities. so we took the responsible choice and located in south carolina. bmw is committed to sustainability. in fact, it's been selected as the world's most sustainable automotive company by the dow jones sustainability index. just a few facts about how seriously we take sustainabili sustainability. we use methane that no one would be burned in the atmosphere from a landfill to provide 50% of the plants total energy, and about 30% of its electricity. we have an 11-megawatt on site energy system. we also have a solar farm to produce energy. with 200 pieces of hydrogen fuel cell material, we are the largest single fleet of hydrogen fuel cells in the world.
we are zero waste to landfill for all non-regulated waste. this program is unless the number one spot on the epa's list of on site green energy producers for the automotive industry. to be -- we provide not only to the local or state economy, but the entire economy as well. as soon as we open a plant, manufactures flock to the area in order to supply us with parts and betrayals necessary to produce our vehicles. today there are 40 of them in the state and a total of 170 nationwide supporting the plant and computing to the u.s. economy. we actually committed to our role as a major exporter from the united states. since our initial $300 million investment in the early '90s, with an annual capacity of about 50,000 eagles, we have invested
an additional $6 billion over the years, expanded the facility to the point where annual production is over 300,000 bmws. today, the plant alone employs over 7000 people supporting the local economy to the tune of $8.8 billion per year, and proposed an additional 31,000 jobs through south carolina. from the supplies to our workers, to the local coffee shop, our manufacturing plant in spartanburg is a force that helps drive the economy in widening circles. now we come to the final letter of the acronym, problem. why we think it's a good platform. there's a few facts help you understand the scope of what we do. we produce all x. three, x. five and x. six sport utility vehicles. soon-to-be a new export production in 2012, 300,000
units big we expect to grow to over 350,000 units this year. and here i is the fact i think that may surprise you. 70% of these vehicles are shipped overseas. that's correct. 70% of these bmws are shipped to about 140 countries worldwide. we are the largest exporter of vehicles from the united states. in addition we also ship kids to another six markets around the world as well as individual parts and was in your lives the facilities of the new england forced to all of this business is profitable for us, profitable for the nation, state, county and local cities as well as manufacturing partners that surround us. with humble beginnings producing 50,000 cars annually, our plant in southern line has become a global success story. by producing exceptional
products with strong group, dedicated workers, our -- but gives back to region and to the u.s.a. this could only be made possible by the trade agreements in place to the auspices of the united states and its partners. as positive as all these may be, there's still room for more comprehensive bilateral free trade agreements. ladies and gentlemen, we strongly support efforts to further open unhindered trade throughout the world and will continue to lend our voice to such efforts. i can clearly state that using the united states as an export platform has been and continues to be a correct and profitable choice for bmw, because we are careful about how we are as francisco sanchez to any indication of plot not.
>> i can touch it is a very to replace the 1994. ambassador froman. >> thanks very much for having me. it is a great pleasure to be here for all sorts of reasons. first, to have colleagues like secretary kerry, secretary lew, secretary pritzker who have been so supportive themselves and their agencies of what we are trying to do through negotiation of these trade agreements makes a real difference. i'm very grateful for all the support. it's great to the governor's comments about the critical importance of trade agreements to creating jobs and expanding the economy. and 40 talked to government. i hear that kind of story and the story needs to be told over and over again in this city because as doug alluded to the isn't necessary as much understanding of how these trade agreements have an impact on job creation, on growth, on communities and how we can make sure that if we do the trade agreements the right way, this will have a very positive impact
on people back home. i'm very grateful to doug and particularly for the leadership he's been playing in mobilizing the base is kinky to convey that message. look, my job here is to talk about how what we're doing on the trade and investment agreement front health contributed export platform that was just talked about. as penny said earlier this month, 20% of our exports come from the subsidiaries of foreign firms in the united states. ..
from something called performance requirements where their products might be substituted out for local products. so our network of bilateral investment treaties is absolutely critical to making this an attractive platform for foreign investment to be used not only here in the united states but as my colleague said, exports to the rest of the world as well. on the trade side, we are involved in a number of initiatives that have been diluted to. the trans-pacific partnership where we are in the endgame dealing with closure. we had the launch of the transatlantic trade and investment partnership with the e.u.. those two giant markets helped bring them closer together and eliminate cost and bring their regulatory of standard regimes more closely together. when we complete those to trade
agreements we will let created free trade with 65% of the global economy and there are other countries waiting in the wings to join in each of those. i expect by the time this is over we will be at 65 to 75% of the global economy being able to be accessed from the united states through free trade agreements. but why stop there? we launched an international service agreement in geneva that covers 70% of the global service market and information technology agreement also in geneva that covers 90% of the i.t. market to have free trade in a series of products in those markets. and we are pursuing bilateral investment treaties with countries like india and china and china has made very dramatic steps in recent months by announcing they are willing to negotiate a bilateral investment treaty with us on the basis of something called a negative list and national treatment during a company's pre-establishment
phase before it gets up and running. these are new breakthroughs with china and new details need to be worked out to see whether those can be translated into real and meaningful commitments. you've all heard over the last day all the reasons why it makes sense to invest in the united states and use this as your platform. and i have to say, i've been visited by companies from all around the world, some of which are represented in this audience, in recent weeks. we said between the legal system, our innovation ecosystem, work force, the access to cheap and clean energy that this is a platform that they want to base themselves. when you add to that trade agreement that we are currently negotiating can be a global platform for exports and i think we will see more and more investment as a result. we are seeing a renaissance of investment and manufacturing in certain sectors that we never thought we would see additional one testament in and we see the expansion of global services
business and even investment in the agricultural sector which is of world class character. we are very optimistic about the u.s. being a platform for global investment and exports with these trade and investment treaties and agreements providing the context for that and i'm very delighted this summit is bringing attention to that. it's nice to be on the panel. to be on a panel where everybody supports what it is we are doing on the trade agreements and we are very grateful for all of the support as we go forward. >> the place to start is with our executives on the panel. as ie looted from the beginning of the last many years there's any series of one of trade bilateral agreements with south korea, colombia. and now we are in the world of talking about these more sweeping agreements with the e.u. and the pacific rim countries. this is making your investment decisions as the prospect or possibility of these broad
agreements -- how does that differ than the kind of one of bilateral agreements? >> it's highly important to us and i will come at this differently with the columbia free trade agreement. we are very worried that colombia and a member of our other country competitors would do a free trade agreement and we would not be included. so much of our competition is non-u.s. in this case mining equipment going into columbia. we would be looking at tariffs for exports in colombia and japan, germany, sweden would not have to encounter. i would go to the workers in central illinois and we have a 10% premium, eight to 10% premium would be. would be sufficient to lose the sale and we cannot find ourselves in that position so it's critical. most of our big a command from this country is sole sourced
u.s. we need to have access to the markets that the tpp is a great one. i am convinced most of those countries will sign an agreement with or without us at some point down the road and we will be potentially looking in on that. i really worry about that as an export and employer of some 50,000 people in the united states and what happens to our workers and opportunities as a result of that. >> let me give the prospective both being an importer and exporter. of course, the closure going all over the world and bringing them in from germany. how is that prospect of the agreements affect your business? >> it must have an impact. if you think we still pay -- just look at our relationship and the united states and europe. we pay to europe but 10% it reduces to pay to go into the u.s.. that sums up year by year to a
number of north of 550 million just as costs related to that. it's not about the import fees we have to pay but it's also about the different standards and you wonder why. i mean, it's about crash testing and it's about emissions standards. it's the same human being sitting in the car coming yet we have different standards and they cost to the tune of a couple hundred million. you just have to develop different costs or encompass all of these different rules. so, not having these additional costs must have a huge impact on the competitiveness, on our growth as such. we still have to see what tpp is going to be in detail but it will have a huge impact. i see today, which is also might responsibility how well when you're dealing with canada, with
mexico as opposed to brazil or argentina. brazil for example overnight has raised by 30%. so out of this is a very exclusive brand. >> governor? >> in a different context how would these developments matter? >> the number you start with is we export 16 more per capita with companies we have free trade agreements. we think the tpip we've been talking about specifically with automobiles we could just in tennessee increase our automobile exports almost a billion dollars which is huge in terms of the jobs created. >> more nissans and wagons. >> we have a gm plant, too. there is 10% as ludwig said.
10% tariff and then seven to 10% cost deutsch to double checking, crash safety and a lot of other things. you start at 17 percent disadvantage, that's a huge. >> if i could come back for men and we just watched canada and the europeans negotiate and finalize a pretty good agreement, which i really hope opens the door on many things we could be doing with your up as a result of that because we have nafta with canada. there's not that much of a difference between what we are doing and europe. so that should help us get that done. >> how are things coming? what do you see as a product for both of these agreements over the next few months or years? >> well, i am optimistic. we are much further along on tpp. it's been under way now for three plus years. we are in the endgame trying to work on the outstanding issues which are still significant. but all the countries around the world are working very hard to try to get this done. with regard to tpip as it was
earlier staged we've also been spending a lot of time with the european colleagues coming to a common understanding of where we have similar approaches so it's no great surprise there to work our way through it which doesn't mean it won't be very difficult, but i think it is doable. the opportunity and challenge with the european agreement is we are going to try to bring our regulatory standards systems more closely together. not deregulation were lower health or safety standards but try to eliminate unnecessary costs and frictions to get in the way between the two rell regulated markets. that is something that is going to take some creativity and it's a new era that we are focused on. but i think it is one that holds out a lot of promise. the only thing i would add, we don't live in a static world. other countries are not just
waiting to see what it is we do. they are out their negotiating preferential access to key markets for our exporters. we need to be on the field as well. we need to make sure that not only are we on the field and getting access to the markets, but we are doing it in a way that raises the overall standards of the international trading system that introduces disciplines to deal with the emerging issues of the trading system there is a stark choice out there and we have made that choice. the choice is are we going to go for a race to the top to raise standards with our tpp partners and tpip partners are very much bought into that or are we going to get dragged into a race to the bottom where we don't want to win and that is with other trading nations might have us do. our goal is to reach these agreements on high standards so it can level the playing field so the workers in the u.s. have the chance to compete on a fair and level playing field because they are the most productive workers in the world but we need
to have a level playing field if we are going to succeed. >> it's not on the initiative geopolitical tensions, is that damaging as the prospect to the tpip? >> it is a serious issue that is out there. it can't be kept on separate tracks in the right wings of the dialogue between the appropriate officials on both sides and i think that you have heard from a number of european officials that they see the logic of moving ahead with tpip to the growth strategy to try to maintain competitiveness in global economy. so we are hopeful we are going to be able to continue to make progress on that. we have teams in brussels as we speak. there are negotiations that had to be canceled in the government shut down unfortunately but that are now back on track and we expect to continue those discussions in the next coming weeks. some people including yourself
welcomed the regulatory alignments and the particularly -- can you give more detail what that mentions in practice? what are the challenges of having different regulatory regimes on the atlantic and what kind of savings would you be looking at it the laws were to be aligned better? >> one is to be crash tested. cars have to be crash tested a different way in europe they may do in the u.s.. in mexico again they have the european crash testing so to go over the border to matteo on other must be a different animal living. i have to say we only can agree that we accept mutually the requirement for the standards of the testing that would be all ready a great success. so we did have one crash test for europe and the u.s. the same bill would be great but it doesn't add a considerable
amount of research and development and cost to every car that we produce and we lose competitiveness. >> the same holds true by the way for the emissions standards where the u.s. is more focused on mileage, where europe is more focused on the emissions. but that's the same thing, just the other side of the claim. it doesn't change, we just measure different things. the outcome is the same. why? >> said the cost savings would be on research and design. they come about when you are making different -- >> of course. we have seen a kind of preposterous situation over the years with a year of a number of companies and this is going back a little bit, the different regulations for backup alarms on machinery. the decibel level, the sound, the frequency, impossible to deal with but adds cost to everyone. on the tail lights for example and lighting machines vary from country to country psp mix if you have to make the same
equipment -- >> there's an engineering change from a manufacturing change. it adds cost, it drives the cost of sort of for nothing. that is something we need to drive out and that will help us. >> what you see on these issues? >> again, i think there's a comment about this not being a static world. and our competitors are getting better and they have agreements that we don't have. senator kerry was talking earlier about the excellence in the u.s. higher education how that has always helped us and we train more and better engineers but those days are ending. and so, our natural design advantages i think are going to be harder to come by going forward. we need those things so that we are not starting with a ten to 20% cost disadvantage. >> we talked about this in the european context it is closer to